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WELLAND, ON, Feb. 5 /CNW Telbec/ - Canadian Union of Public Employees
(CUPE) Ontario President Sid Ryan will meet with members of CUPE 1115, Welland
city workers, this Wednesday, February 6, to share with them why privatized
facilities like sports complexes and arenas are a rip-off for local residents
and a drain on local municipal budgets.
"From Windsor to Kingston to Niagara, local councils have rejected
so-called public-private partnerships (P3s) for building and operating
community facilities," says Ryan. "That's because they end up costing more,
are not responsive to local needs, and are less accountable than
publicly-owned and operated facilities."
Ryan's meeting with CUPE 1115 members comes in the wake of Welland city
council's referral of a proposed $17 million soccer complex and possible arena
to its budget review committee. Welland city manager Peter Simmons is
promoting the idea that the complex be developed as a public-private
partnership.
CUPE has conducted extensive research into public service funding models
including P3s. "In general, private borrowers pay at least 1.5% or 2% higher
interest rates than municipal governments do, and that can amount to 30 to 40%
higher interest payments over a 20-year financing deal," says Ryan. "As well,
private 'partners' in these arrangements expect to make a return of about 15%
on a project. That's 15% the public wouldn't have to pay if the project were
handled by the municipality."
Ryan adds that, in many cases, residents have had to pay higher user fees
to access private arenas, they frequently have less access, and they usually
face service cuts. Last year, the City of Ottawa took back control of one
arena and offered another private operator a bail out of $1.6 million a year
to make the deal work. Ryan added that the town of Oshawa went for a P3 arena,
and then realized it was a bad deal when they actually saw the financial
details.
CUPE Ontario is prepared to work with CUPE 1115 president Scott
Richardson and his members to make the case to Welland City Council and its
budget review committee that a P3 model is not the right model for Welland's
proposed sports facilities, says Ryan. The matter comes up before the budget
review committee on February 12.